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An intangible asset is an identifiable non-monetary asset that cannot be seen, touched or physically measured, which iscreated through time and/or effort and that is identifiable as a separate asset.
There are two primary forms of intangibles — legal intangibles (such as trade secrets (e.g., customer lists), copyrights, patents, and trademarks) and competitive intangibles (such as knowledge activities (know-how, knowledge), collaboration activities, leverage activities, and structural activities).
Legal intangibles are known under the generic term intellectual property and generate legal property rights defensible in a court of law. Competitive intangibles, while legally non-ownable, directly impact effectiveness, productivity, waste, and opportunity costs within an organization — and therefore costs, revenues, customer service, satisfaction, market value, and share price. Human capital is the primary source of competitive intangibles for organizations today. Competitive intangibles are the source from which competitive advantage flows, or is destroyed.
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